CSR

US sees record season for climate change proposals

2007 was a record US proxy season for shareholder proposals seeking to have companies address climate change, research by PROXY Governance has found. Based on preliminary findings, five climate proposals were supported by more than 30% of the votes cast - in prior years, only one such proposal has received this level of shareholder backing.

Over 40 climate change proposals were filed for 2007; and 17 made it to a vote (compared to 7 in 2006 and 10 in 2005). Of the remaining proposals, 19 were withdrawn by proponents – many after agreements having been reached with companies – and seven were omitted from ballots as a result of no-action rulings by the US Securities and Exchange Commission.

However, average support for climate-related investor proposals rose only slightly during the year, reaching 21%. PROXY Governance suggested this may mean shareholder support for the issue is levelling off.

2007 also saw some proposals asking companies to begin to set quantitative goals for reducing greenhouse gas emissions rather than merely disclosing climate change risks and liabilities. Support for these more prescriptive proposals averaged 18%.

Scott Fenn, PROXY Governance managing director of policy, commented: “Investors concerned about climate change attempted to raise the bar on some companies this season by filing proposals requesting more concrete actions on the issues, but it looks like they sacrificed something in terms of higher votes in order to push more substantive proposals”.

August 2007